Horrible Exchange Rate

[mads]

I always noticed that the currency conversion when taking out money in Thai atms always are super low compared to the "real" conversion rate.

But today I got an extra piece of paper out of the atm besides the usual statement of how much money you have taken out. This paper looked like

a statement from Mastercard that I had chosen not to use Mastercards currency conversion but instead the bank ?? I never had the option to chose which

one I would go with. I have attached the two statements i got from the bank.

The current rate for Danish currency is 1.00 DKK = 5.57632 THB, however the rate I get from the atm is 5.09, thats almost 10% less if I'm correct.

10% less in the currency conversion and 150 THB seems very steep to me, I can deal with the 150 Thb but 10% less....

Am I being robbed or what is going on ?

Edited October 20, 2010 by mads

[falang07]

You say that the current rate for Danish currency is 1.00 DKK = 5.57632 THB, I bet you mean the spot price in Forex which you never get, there is the buy and sell price + mastercard/visa rates are always worse than in any of the banks

[mads]

Yes I know but I'm confused to whether the rate im getting is from mastercard or the thai bank since I got the statement that I refused the mastercard rate.

[JimGant]

Yes I know but I'm confused to whether the rate im getting is from mastercard or the thai bank since I got the statement that I refused the mastercard rate.

I can't read your insert when I try and expand it....but it sure sounds like you found one of the ATM machines previously reported that is using dynamic currency conversion (DCC) for MasterCard (Cirrus) cards. (Visa/Plus supposedly will not allow DCC for ATM transactions.) As such, the bank is using its own conversion rate, which will always be worse than either the Visa/Plus or MasterCard/Cirrus network rates.

Which bank was the ATM associated with?

mastercard/visa rates are always worse than in any of the banks

Wrong. Miles of discussion on this, but, in short, the exchange rate used by the Visa and MasterCard networks is the interbank exchange rate, which is always better than even the TT rate you get with wire transfers, and certainly better than most bank's 'buy' rate (Super Rich usually being the exception). It's the fees/rates added on by your issuing bank, including passing-on the Visa/MasterCard foreign transaction fee, that can make ATM FX so bad. Plus, of course, the new 150 baht ATM owner fee.

The exception to NOT using the MasterCard or Visa network FX rate is, as discussed, DCC. Which is apparently what the OP encountered.

[mads]

Thanks for your replies. The bank in question is Bank of Ayudhya

[JimGant]

Yup, Bank of Ayudhya is the culprit mentioned in earlier threads on this subject. Believe they're the only ones using DCC for ATM withdrawals....

Some of the yellow Bank of Ayudhya ATMs have no fees, but use Dynamic Currency Conversion (DCC) on MasterCard transactions to set their own exchange rate.

See HERE

Note the sign on the machine says Euros and USDs only. Guess Denmark has now been included.

And, I wonder (this has probably been answered elsewhere) whether or not you're charged the 150 baht fee should you use a Visa/Plus ATM card? (since, supposedly, only MasterCard allows DCC for ATM transactions).

[mads]

Thank you very much for that helpful information. From now on only Aeon ATM will taste the magnet-strip/chip on my mastercard

BTW. I got charged 150 Thb from my mastercard and the lousy exchange rate.

[grahamhc]

A bit of money transfer guidance. I undersand that you are from Denmark, but not if you are here on a short holiday or the "normal Scandinavian WINTER VACATION". In fact it does not matter, as this is general advice.

For those here for a long period, or who visit on a regular basis, OPEN A THAI BANK ACCOUNT. Then get your money sent by SWIFT (Telegraphic Transfer} from your home country in one hit and not lots of little bites through an ATM, each rime with service charges

I have a UK bank and a Thai bank. My Pension is paid into my UK bank and not sent here. I transfer money over about every 3 months. I do it myself through my Internet banking and they charge only 9.50GBP for their service (About 440 Baht) regardless of the amount.

Two days ago, I got an FX rate of 46.75 when I checked my bank account, which was higher than changing cash on the street, so a LOT LESS than using an ATM using Visa/MasterCard for drawing on home funds.

I hope this is of help to you or any other person reading the thread. :jap:

PS: Kasikorn is the easiest bank to open an account, and good FX rates too. Open your internet banking option there at the same time.

[bkk_mike]

If you notice a really bad FX rate at ATMs normally (not only Bank of Ayudhaya, which, from this post seem to be wanting foreigners to literally avoid them), it's normally your home bank applying a spread on top of the mastercard/visa rates, which are actually pretty good.

i.e. It's common for UK banks to charge 2.5% (or more) as a spread on the FX rate, with some double-dipping by also having a seperate charge for the use of the card abroad. (charging you twice for the same transaction, with the 150 baht the Thai banks add on being a third charge making taking out small amounts from ATMs a pretty expensive proposition here.). I'd imagine that if you check the small print on your bank's documentation for your account, you'll find something similar.